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(Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.)

Form 20-F:   ý      Form 40-F:   o 

(Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1)):

Yes:   o      No:   ý 

(Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7)):

Yes:   o      No:   ý 

(Indicate by check mark whether the registrant by furnishing the information contained in this Form, the Registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.)

Yes:   o      No:   ý 

 

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Oscar Thompson
CEO and Head of Investor Relations
oscar@telepart.com.br
Phone: 55 61 3429-5600

TELEMIG CELULAR PARTICIPAÇÕES S.A.
REPORTS FIRST QUARTER 2006 RESULTS

- EBITDA of R$87 million or 35% of net service revenues
- Net income of R$32 million for the quarter
- 57,126 net additions during the quarter
- Market share in the Triângulo Mineiro region estimated at 15% in less than one year after the launch of operations

Brasília, May 26, 2006 – Telemig Celular Participações S.A. (BOVESPA: TMCP3 (Common)/TMCP4 (Preferred); NYSE: TMB), the holding company of the provider of wireless telecommunications services in the State of Minas Gerais, today announced its first quarter 2006 results. The Company registered 57,126 new customers for the quarter, increasing its client base to 3,401,310. EBITDA reached R$86.6 million in the 1Q06, representing 34.6% of net service revenues.

Operating Highlights:

Net additions of 57,126 customers in the 1Q06

The Company’s customer base reached 3,401,310 during the first quarter of 2006, representing a 19% increase when compared to the same quarter of the previous year. For the quarter, net additions amounted to 57,126.

In the 1Q06, prepaid net additions were 68,843, bringing the total prepaid base to 2,556,505 or 75% of the total base. The postpaid base decreased by 11,717 subscribers, ending the quarter with 844,805 subscribers or 25% of the total base.

www.telemigholding.com.br - 1/12

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Churn rate

For the first quarter of the year, blended annualized churn rate slightly increased to 30% from the 29% registered in the 4Q05. When compared to the previous quarter, the annualized prepaid churn rate increased by 1 p.p. reaching 33%. For the postpaid segment, which accounts for most of the revenues generated, churn rates increased by 3 p.p. to 21% when compared to the previous quarter. Despite the increasingly competitive environment, the annualized postpaid churn rate has been controlled and has not surpassed 25% for the last 3 years.

Operating revenues

Net service revenues totaled R$250.0 million for the quarter, a decrease of R$29.0 million or 10.4% over the previous quarter, due to a decrease of 7.2% in total traffic primarily associated with seasonality (9.0% decrease in outgoing traffic and 5.3% decrease in incoming traffic) and to increased promotional minutes offered in the quarter. When compared to the 1Q05, net service revenues increased by R$7.6 million or 3%.

Net equipment revenues for the quarter totaled R$28.3 million, an increase of 13.2% when compared to the R$25.0 million registered in the 4Q05. Such result has been attained due to reduced handset subsidies offered during the first quarter.

As a result, total net revenues were R$278.3 million for the quarter, 8.5% lower when compared with the last quarter, but 6% higher when compared to the same quarter of the previous year.

Data revenues represented 8.4% of net services revenues for the 1Q06. It should be noted that the criteria for presenting the data service revenues have been adjusted in order to become more comparable with the indicators presented by our peers. As a result, we have included the VAS (value-added service) revenues to the criteria. For comparison purposes, such indicator would have been 8.8% in the last quarter of 2005 as opposed to the 6.7% that was disclosed in the previous earnings release.

For the first quarter of the year, handset subsidies for client acquisitions were R$10.6 million or R$34.1 per gross addition, compared to the R$17.2 million and R$32.8 per gross addition registered in the previous quarter.

Operating costs and expenses

Cost of services for the first quarter of 2006 totaled R$61.2 million, 15.9% lower when compared to the previous quarter. This difference is primarily related to the decrease of Fistel

www.telemigholding.com.br - 2/12

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activation taxes due to lower net additions and to lower interconnection costs associated with reduced outgoing traffic.

Selling and marketing expenses for the quarter totaled R$60.4 million, down 22.0% quarter-over-quarter due to reduced promotions and lower commissions related to a decrease on gross additions in the period as a result of seasonal factors.

Customer acquisition cost for the first quarter of 2006 increased to R$166 from the R$147 reported in the previous quarter. Despite the significant decrease on the total acquisition costs during the quarter, the customer acquisition cost increased due to lower gross additions (40% lower than the previous quarter).

Retention costs, as a percentage of net service revenues, remained fairly stable at 15.4% in the 1Q06 when compared to the 15.7% registered in the last quarter of 2005.

As anticipated in the previous earnings release G&A expenses remained within the range of 6% to 8% of net service revenues during the 1Q06, representing 7.8% of net service revenues or R$19.5 million.

Bad debt as a percentage of net service revenues increased to 4.7% when compared to the 2.3% reported in the previous quarter. When calculated against total net revenues, bad debt reached 4.2% during the 1Q06 compared to the 2.1% reported in the 4Q05. This increase is related to the credit profile of clients acquired during Christmas campaigns.

Average revenue per user (ARPU)

Postpaid MOU (minutes of use) for the 1Q06 totaled 176, representing a 10% decrease when compared to the 194 registered in the previous quarter. As a result, postpaid ARPU (average revenue per user) decreased by 9% reaching R$64.0 for the 1Q06 compared to the R$70.2 registered in the 4Q05. The decrease in traffic usage and, consequently, in ARPUs, is primarily associated with seasonality.

For the first quarter of the year, prepaid MOU reached 27, representing a 14% decrease when compared to the 31 reported in the previous quarter. As a result, prepaid ARPU decreased by 16% reaching R$9.5 in the 1Q06 compared to the R$11.4 reported in the 4Q05.

As a result, blended ARPU for the 1Q06 decreased to R$23.3 compared to the R$26.7 registered in the 4Q05.

www.telemigholding.com.br - 3/12

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Market share estimated at 37% in the quarter

Total market share was estimated at 37% in the first quarter of the year. Excluding Triângulo Mineiro region, market share was estimated at 39% compared to 41% registered in the previous quarter. Telemig Celular continues to expand its market share in the Triângulo Mineiro region at a very fast pace. After less than one year of operations, market share was already estimated at 15%.

Total gross sales share for 1Q06 was estimated at 30%. Excluding Triângulo Mineiro region, gross sale share was estimated at 29% compared to the 34% registered in the 4Q05. For the Triângulo Mineiro region, gross sale share was estimated at 34%.

EBITDA margin of 34.6% of net service revenues for the quarter

EBITDA and EBITDA margin (excluding handsets revenues) for the first quarter of 2006 reached R$86.6 million and 34.6%, respectively, compared to the R$102.2 million and 36.6% registered in the previous quarter.

Depreciation and amortization

For the 1Q06, depreciation and amortization expenses reached R$46.6 million, a decrease of 10% when compared to the R$51.9 million registered in the previous quarter.

www.telemigholding.com.br - 4/12

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Net financial expense of R$14.7 million

 

	R$ million
	4Q05	1Q06
Interest Expense (a)	(14.6)	(34.4)
Interest Income (b)	34.9	32.0
Foreign Exchange Gain (Loss) (c)	(13.7)	17.1
Net Financial Income (Expense)	6.6	14.7

Note: a) Interest expense: includes financial expenses related to debt, losses on hedging operations (if any), and taxes on interest income; b) Interest income: includes results of cash investing activities and gains on hedging operations (if any); and, c) Foreign exchange gain (loss): almost exclusively reflects currency devaluation changes on debt principal and interest payable.

DETAILED FINANCIAL EXPENSE INFORMATION (NET OF TAXES*)

	R$ million
	4Q05	1Q06
Expense related to debt denominated in foreign currency	(20.0)	11.7
Gain (loss) on hedging operations	3.5	(24.8)
Sub-total	(16.5)	(13.1)
Expense related to debt denominated in Reais	(0.1)	0.0
Financial expense (debt related)	(16.6)	(13.1)
Net financial expense (not related to debt)**	(9.5)	(0.5)
Sub-total	(26.1)	(13.6)
Interest income – cash investing activities	32.7	28.3
Net Financial Income (Expense)	6.6	14.7

* Net of PIS/COFINS on interest income.
** Net financial expense not related to debt are primarily associated with taxes such as CPMF, PIS, COFINS and IOF

Net income of R$31.6 million for the quarter

Net income for the 1Q06 totaled R$31.6 million, or R$1.785 per ADS (R$0.089 per thousand shares). When compared to the 1Q05, net income decreased by 4% or R$1.2 million.

Total debt of R$217.7 million for the quarter

As of March 31, 2006, total debt was R$217.7 million, 100% of which was denominated in U.S. Dollars. Of the total debt denominated in US Dollars, 85% was hedged by the end of the period.

Negative net debt of R$416.9 million

As of March 31, 2006, the Company’s indebtedness was offset by cash and cash equivalents (R$667.4 million) but was impacted by accounts payable from hedging operations (R$32.8 million), resulting in a negative net debt of R$416.9 million.

www.telemigholding.com.br - 5/12

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Investments totaled R$16.1 million for the quarter

During the first quarter of 2006, Telemig Celular’s capital expenditures were R$16.1 million. The breakdown of such investments was as follows:

CAPEX breakdown

CAPEX (R$ million)	1Q05	2Q05	3Q05	4Q05	1Q06
Network	7.5	88.0	29.1	103.5	9.1
IS/IT	5.8	3.6	6.7	12.6	3.7
Others	2.8	4.6	3.5	9.0	3.3
T O T A L	16.1	96.2	39.3	125.1	16.1

Debt payment schedule

Year	R$ million	% denominated in  foreign currency
2006	43.9	100.0%
2007	-	-
2008	-	-
2009	173.8	100.0%

Free cash flow

Free cash flow for the quarter was negative at R$18.5 million when compared to the positive cash flow of R$89.2 million registered in the previous quarter.

www.telemigholding.com.br - 6/12

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Strong financial ratios

Ratios	1Q05	2Q05	3Q05	4Q05	1Q06
Net Debt/EBITDA (1)	(1.04)	(0.86)	(1.02)	(1.04)	(0.99)
Net Debt/Total Assets	(22%)	(19%)	(23%)	(22%)	(21%)
Interest Coverage Ratio (1)	9.6	9.5	10.1	11.7	10.3
Current Liquidity Ratio	2.3	2.2	2.3	1.7	1.9

(1) Last twelve months.

*******************

For additional information please contact:

Telemig Celular Participações S.A.
Investor Relations Department
Oscar Thompson / Renata Pantoja / Fernanda Ribeiro
Phones: (55 61) 3429-5600 / 5616 / 5617
Fax: (55 61) 3429-5626
E-mail: ri@telepart.com.br

This press release contains forward-looking statements. Such statements are not statements of historical fact, and reflect the beliefs and expectations of the Company's management. The words "anticipates," "believes," "estimates," "expects," "forecasts," "intends," "plans," "predicts," "projects" and "targets" and similar words are intended to identify these statements, which necessarily involve known and unknown risks and uncertainties. Known risks and uncertainties include those resulting from the short history of the Company's operations as an independent, private-sector, entity and the introduction of competition to the Brazilian telecommunications sector, as well as those relating to the cost and availability of financing, the performance of the Brazilian economy generally, the levels of exchange rates between Brazilian and foreign currencies and the Federal Government's telecommunications policy. Accordingly, the actual results of operations of the Company may be different from the Company's current expectations, and the reader should not place undue reliance on these forward-looking statements. Forward-looking statements speak only as of the date they are made, and the Company does not undertake any obligation to update them in light of new information or future developments.

www.telemigholding.com.br - 7/12

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OPERATIONAL DATA

		2005										2006		Var. %
		1st Quarter		2nd Quarter		3rd Quarter		4th Quarter		YTD		1st Quarter		(1Q06/4Q05)
Licensed Pops (in millions)		18.8		19.0		19.2		19.2		19.2		19.2		0.2%
Clients		2,857,654		2,973,130		3,042,414		3,344,184		3,344,184		3,401,310		1.7%
Postpaid		763,142		787,245		800,041		856,522		856,522		844,805		-1.4%
Prepaid		2,094,512		2,185,885		2,242,373		2,487,662		2,487,662		2,556,505		2.8%
MOU Incoming
Postpaid		70		72		76		75		73		69		-8.2%
Prepaid		26		25		24		23		24		21		-12.6%
MOU Outgoing
Postpaid		117		117		115		119		117		107		-10.4%
Prepaid		8		7		7		8		7		6		-17.3%
Total Outgoing Traffic (Million of Minutes)		313.6		314.9		323.1		348.7		1300.2		317.4		-9.0%
Total Incoming Traffic (Million of Minutes)		318.1		324.6		340.4		350.3		1333.4		331.6		-5.3%
Average Revenue per User - ARPU (R$)		26.5		26.9		26.9		26.7		26.8		23.3		-13.1%
Postpaid		64.4		68.7		69.5		70.2		68.3		64.0		-8.9%
Prepaid		12.6		11.8		11.7		11.4		11.8		9.5		-16.3%
Service Revenues (R$ millions)
Monthly Fee		53,904		57,764		58,074		57,393		227,134		52,267		-8.9%
Outgoing Traffic		75,185		95,730		100,578		104,895		376,389		98,665		-5.9%
Incoming Traffic		90,503		88,852		91,834		91,318		362,507		84,654		-7.3%
Other		22,863		22,163		24,943		25,453		95,421		14,440		-43.3%
TOTAL		242,455		264,509		275,429		279,059		1,061,452		250,027		-10.4%
Data Revenues (% of net serv. revenues)		6.0%		5.2%		5.6%		6.7%		5.9%		8.4%		1.7 p.p.
Cost of Services (R$ millions)
Leased lines		11,871		13,949		12,506		15,057		33,428		15,815		5.0%
Interconnection		19,648		12,966		9,265		15,516		139,559		9,347		-39.8%
Rent and network maintenance		12,753		14,502		15,118		16,976		42,413		17,821		5.0%
FISTEL and other taxes		13,355		14,502		13,377		19,672		51,884		14,848		-24.5%
Other		9,549		7,110		7,722		5,495		25,104		3,347		-39.1%
TOTAL		67,176		63,029		57,987		72,717		292,388		61,178		-15.9%
Churn - Annualized Rate		33.4%		34.3%		38.3%		28.7%		33.6%		30.2%		1.5 p.p.
Postpaid		23.5%		24.8%		21.7%		18.3%		22.0%		21.3%		3.0 p.p.
Prepaid		37.0%		37.7%		44.3%		32.4%		37.8%		33.2%		0.8 p.p.
Cost of Acquisition (R$)		145		147		141		147		145		166		13.3%
Retention Costs (% of net serv. revenues)		12.6%		13.0%		12.0%		15.7%		13.3%		15.4%		-0.3 p.p.
CAPEX (R$ millions)		16.1		96.3		39.2		125.1		276.7		16.1		-87.1%
Number of locations served		463		502		509		535		535		540		0.9%
Number of cell sites		1388		1598		1620		1677		1677		1677		0.0%
Number of switches		14		15		15		17		17		17		0.0%
Headcount		2,197		2,282		2,341		2,378		2,378		2,540		6.8%
Estimated Market Share
Total		46%		41%		39%		38%		38%		37%		-1.0 p.p
Minas Market - excluding Triângulo
Mineiro region		46%		44%		42%		41%		41%		39%		- 2.0 p.p
Triângulo Mineiro region		0%		4%		8%		12%		12%		15%		2.5 p.p

www.telemigholding.com.br - 8/12

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INCOME STATEMENT (BR GAAP)

												(in R$ 000)
		2005										2006		Var. %
		1st Quarter		2nd Quarter		3rd Quarter		4th Quarter		YTD		1st Quarter		(1Q06/4Q05)
Service Revenues - GROSS		335,713		359,130		377,816		389,647		1,462,306		356,139		-8.6%
Equipment Revenues - GROSS		27,999		31,905		24,527		33,139		117,570		33,356		0.7%
Total Revenues - GROSS		363,712		391,035		402,343		422,786		1,579,876		389,495		-7.9%
Taxes		(100,957)		(102,686)		(108,562)		(118,737)		(430,942)		(111,191)		-6.4%
Service Revenues - NET		242,455		264,509		275,429		279,059		1,061,452		250,027		-10.4%
Equipment Revenues - NET		20,300		23,840		18,352		24,990		87,482		28,277		13.2%
Total Revenues - NET		262,755		288,349		293,781		304,049		1,148,934		278,304		-8.5%
Cost of Services		67,176		63,029		57,987		72,717		260,909		61,178		-15.9%
Cost of Equipment		29,254		39,570		27,458		42,206		138,488		38,890		-7.9%
Selling & Marketing Expenses		53,569		53,264		60,835		77,481		245,149		60,432		-22.0%
Bad Debt Expense		4,556		5,040		5,083		6,415		21,094		11,759		83.3%
General & Administrative Expenses		10,977		19,380		18,738		3,000		52,095		19,484		549.5%
EBITDA		97,223		108,066		123,680		102,230		431,199		86,561		-15.3%
%		40.1%		40.9%		44.9%		36.6%		40.6%		34.6%		-2.0 p.p.
Depreciation & Amortization		59,873		60,446		52,682		51,863		224,864		46,610		-10.1%
Interest Expense (1)		18,460		41,176		27,158		14,671		101,465		34,442		134.8%
Interest Income		(39,318)		(36,003)		(34,891)		(34,940)		(145,153)		(32,051)		-8.3%
Foreign Exchange Loss		1,901		(47,151)		(17,474)		13,658		(49,066)		(17,139)		-225.5%
Others		4,428		5,374		4,681		7,526		22,009		5,114		-32.0%
Income Taxes		13,391		30,336		21,180		5,916		70,823		12,946		118.8%
Minority Interests		5,709		12,121		10,687		3,620		32,137		5,053		39.6%
Net Income		32,779		41,767		59,657		39,916		174,119		31,586		-20.9%
Number of shares (thousand)		350,072,111		353,926,470		353,926,470		353,926,470		353,926,470		353,926,470		0.0%
Earnings per thousands shares (R$)		0.094		0.118		0.169		0.113		0.492		0.089		-20.9%
Earnings per ADS (R$)		1.873		2.360		3.371		2.256		9.839		1.785		-20.9%

(1) Interest paid: 1Q05 - R$13,068 thousand; 2Q05 - R$ 8,236 thousand; 3Q05 - R$10,282 thousand; 4Q05 - R$ 5,333 thousand; and, 1Q06 - R$ 9,152 thousand.

www.telemigholding.com.br - 9/12

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BALANCE SHEET (BR GAAP)

										(R$ 000)
		1Q06		4Q05				1Q06		4Q05
Current Assets						Current Liabilities
Cash & cash equivalents		667,431		706,331		Loans & Financing		43,885		48,897
Accounts Receivable		226,445		226,403		Loan Interest		4,606		8,555
Taxes Receivable		87,295		76,455		Suppliers		284,103		302,672
Other Assets		86,579		29,889		Taxes Payable		56,002		56,404
		1,067,750		1,039,078		Dividends		102,557		102,593
						Other Current Liabilities		79,680		81,416
								570,833		600,537
Long-term Assets		305,584		299,853
						Loans & Financing		173,823		187,324
Deferred Assets		7,918		8,392
						Other Long-term Liabilities		63,335		47,679
Plant & Equipment
Cost		1,901,872		1,886,226		Minority Interest		153,424		148,371
Accumulated Depreciation		(1,251,913)		(1,211,428)
		649,959		674,798		Shareholders' Equity		1,069,796		1,038,210
		2,031,211		2,022,121				2,031,211		2,022,121

DEBT POSITION (BR GAAP)

	(in R$ 000)
Debt	1Q06
	US$
Short term	43,885
Long Term	173,823
Total	217,708

www.telemigholding.com.br - 10/12

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CASH FLOW (BR GAAP)

				(in R$ 000)
		1Q06		YTD - 2006
Operating Activities:
Net income		31,586		31,586
Adjustments to reconcile net income (loss) to net cash
provided by operating cash activities
Depreciation and amortization		46,610		46,610
Monetary variation and foreign exchange loss (principal)		(16,908)		(16,908)
Unrealized income on hedging operations		20,702		20,702
Deferred income taxes and social charges		(18,724)		(18,724)
Minority interest		5,053		5,053
Other		792		792
Changes in operating assets and liabilities		(90,327)		(90,327)
Net cash provided by operating activities		(21,216)		(21,216)
Investing Activities:
Proceeds from sale of property, plant and equipment		110		110
Capital expenditures		(16,153)		(16,153)
Additions to Deferred Assets		-		-
Net cash used in investing activities		(16,043)		(16,043)
Financing Activities:
New loans		-		-
Amortization of loans		(1,605)		(1,605)
Payment of dividends and interest on capital		(36)		(36)
Net cash used in financing activities		(1,641)		(1,641)
Net increase (decrease) in cash and cash equivalents		(38,900)		(38,900)
Cash and cash equivalents, beginning of the period		706,331		706,331
Cash and cash equivalents, end of the period		667,431		667,431

www.telemigholding.com.br - 11/12

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GLOSSARY OF KEY INDICATORS

I) Average Subscribers
a)  Average subscribers – monthly
		Sum of subscribers at the beginning and the end of the month
		2
b)  Average subscribers – quarterly and year to date
		Sum of the average subscribers for each month of the period
		Number of months in the period
II) Churn Rate (Annualized)
a) Churn % quarterly
		Sum of deactivations / Sum of average monthly opening subscribers for the 3 months x 12
		3
b) Churn % - year to date
		YTD deactivations / Sum of avg monthly opening subscribers since beginning of the year x 12
		Number of months in the period
III) MOU – Minutes of Use (Monthly)
		Number of total billable minutes for the period / Average subscribers for the period
		Number of months in the periods
IV) ARPU – Average Revenue per User
		Net service revenues for the period (excluding roaming-in revenues)
		Average subscribers for the period
V) Customer Acquisition Cost
		(Sum of Marketing salaries, Selling salaries, Consulting (Sales and Marketing),
		Commissions, Handsets subsidies, Advertising and promotions,
		FISTEL tax (activation tax), less Activation fee for the period)
		Number of gross activations in the period
VI) Free Cash Flow
		Free Cash Flow = (EBITDA – CAPEX – Taxes – Net Financial Expenses*
		– Minority Interests – Working Capital Variation)
* Considers interest paid.
VII) Working Capital Variation
		Working Capital Variation = ( D Current Assets – D Cash & Cash Equivalents ) –
		(D Current Liabilities – D Short Term Loans and Financing - D Loan Interest - D Dividends)
VIII) Interest Coverage Ratio
		Interest Coverage Ratio = EBITDA / Interest Paid
IX) Current Liquidity Ratio
		Current Liquidity Ratio = Current Assets / Current Liabilities
X) EBITDA
		EBITDA = Operational Revenues - Operational Costs - Operational Expenses* - Bad Debt
		* Does not include profit sharing.

 

www.telemigholding.com.br - 12/12

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